Vietnam is a development success st

Vietnam is a development success story. Political and economic reforms (Doi Moi) launched in 1986 have transformed the country from one of the poorest in the world, with per capita income around $100, to lower middle income status within a quarter of a century with per capita income of over $2,000 by the end of 2014.

Vietnam has also made remarkable progress in reducing poverty. Using the $1.90 2011 PPP line, the fraction of people living in extreme poverty dropped from over 50% in the early 1990s to 3% today. Concerns about poverty are increasingly focused on the 15% of the population who are members of ethnic minority groups. These groups account for more than half the poor, and progress on ethnic minority poverty reduction has slowed.

Vietnam’s growth rate averaged 6.4% per year in the 2000s, but begun to slow in the wake of the global financial and economic crisis. However, driven by strengthening domestic demand, GDP has accelerated to 6.3% during the first half of 2015, the fastest first-half-of-the-year growth rate in the past five years. Vietnam has managed to improve macroeconomic stability, with the consumer price index rising only 0.6% year-on-year in August 2015, down from 4.3% a year earlier.

According to a recent report co-published by the Government of Vietnam and the United Nations in September 2015, Vietnam has completed a number of MDGs and targets such as (i) eradicate extreme poverty and hunger, (ii) achieve universal primary education, (iii) promote gender equality in education and it has achieved certain health-related indicators such as reducing the maternal mortality ratio and the child mortality ratio. The country also achieved the target for malaria and tuberculosis control as well as combating the HIV/AIDS prevalence rate and is on the way towards reaching the targets for universal access to reproductive health services and improving maternal health.

The Socio-Economic Development Strategy (SEDS) 2011-2020 gives attention to structural reforms, environmental sustainability, social equity, and emerging issues of macroeconomic stability. It defines three "breakthrough areas": (i) promoting human resources/skills development (particularly skills for modern industry and innovation), (ii) improving market institutions, and (iii) infrastructure development.

The five-year Socio-Economic Development Plan (SEDP 2011-2015) elaborated objectives for the first five years of the SEDP including high quality and sustainable economic growth, improved living standards of ethnic minority populations, strengthened environmental protection; and mitigation and prevention of the adverse impacts of climate change. In addition to the elaboration of three SEDS breakthrough areas, the SEDP 2011-2015 identified three critical restructuring areas – the banking sector, state-owned enterprises (SOEs) and public investment that are needed to achieve these objectives. However, a recent draft of the SEDP 2016-20 acknowledges the slow progress of the reform priorities of the SEDP 2011-215 and emphasizes the need to accelerate these reforms in 2016-2020 to achieve the targets set in the 10-year strategy. This draft SEDP 2016-20 also acknowledges the challenges and opportunities associated with further deepening of economic integration since almost all tariff lines will be zero by 2020 and emphasizes the proactive integration and macroeconomic stability as other important objectives of the next five years.

The Government has recently paid increasing attention to improving the business environment, with two Resolutions issued in March 2014 and March 2015, setting out concrete actions to remove obstacles to doing business in Vietnam, with a goal of achieving a business environment comparable to the average of the ASEAN-6 group.